Buying a home is huge- and the advantage is, it’s a smart move because it’s a big financial investment. But the celebrations begin after all outstanding mortgage payments have been cleared. Before this however, comes home financing which is an economically burdening period one is totally able to cope with. But just how easy you cope with it depends on the moves you made with your home financing decisions.
Applying for a mortgage is easy- bad credit ratings not withstanding. With a steady paycheck and a good lender, the financing journey should be a smooth one. First step is always getting pre-qualification. In plain English getting pre-qualified means that you are financially able to get a home mortgage. To make it through this step, your credit history is pulled out. You should aim for a high credit score as that will entitle you to more friendly rates. That is why it is recommended most of the time that you clean up your credit history by paying off any outstanding debt. This shows financial planning and it always goes down well with your lender.
Getting good quotes is basically what any homeowner wants. The only challenge is that good quotes are like mining for gold- you have to dig deep. Do comparisons between the many mortgage lenders that are available and see which one offers the friendliest deals. After that, try surprising the lender by offering to pay a huge down payment. Anywhere above 20% is considered good enough. Do not refrain from breaking the bank to do this as it will save you more when it comes to the monthly payments.
Ensure that the repayment period is suiting your financial lifestyle. If the period is too short, you may have a lot of stress trying to balance out the mortgage payments with other demanding financial tasks. There is always the option of refinancing which could equate to saving you thousands in the long term.
Even as you pay your mortgage, there comes other times when your home needs financing. It could be for a home improvement project, and make a few adjustments that will raise the overall worth of your house. Since money will be needed, you can always get a home equity loan, which stakes on your home as collateral (the collateral worth is calculated by taking the overall worth of the house, minus what you owe). You however need to ascertain that you will be able to cover the loan repayments in your monthly paycheck.